FTX customers form voting block to claw back funds after Sam Bankman-Fried conviction


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  • Around a hundred FTX customers have joined a block that represents more than $230 million in claims. 
  • The coalition is voting for a plan that includes FTX 2.0, recovery and equity token, and preference settlement.
  • The debtors’ group, which is overseeing the bankruptcy, will file the final plan by December 16.

Bankrupt FTX customers’ challenge to recover their funds continue despite founder Samuel Bankman-Fried’s recent conviction. Some of the exchange’s affected users have started a voting block with proposals to recover funds ahead of the key December 16 date, when FTX debtors will file an amended proposal to the court. 

The coalition is a group of users that represent over $230 million in claims,  and the block is expected to come up with a plan that will be put to vote. The group of creditors are intent on swaying or influencing the recovery plan proposed by the bankrupt exchange, to ensure that both groups, small and large creditors are made whole, on an expedited timeline.

Also read: Breaking:FTX founder Sam Bankman-Fried found guilty on all counts including stealing $8 billion from users 

FTX customers attempt fund recovery

A group of FTX users have come together to form a coalition and are working on a plan that includes:

1. FTX 2.0: Restarting the exchange with transparent management and stringent regulatory oversight.

2. Recovery rights and  Equity Offering: Introduction of a Recovery Rights Token.

3. Ventures for Customers: Venture capital portfolio to be exclusive to recovery for customers and not for non-customers.

4. Preference Settlement via Trading Volume: If the restart of the exchange is feasible, settle customer preference claims by considering incentives for achieving specific trading volumes.

The X account @AFTXCreditor shared details of the voting block’s plan in a tweet. 

Debtors will file a final plan by December 16 that will include the details on how current administrations plan to deal with the mounting task of recovering lost funds, estimated to be nearly $9 billion for FTX.com. This plan and the coalition’s initiative to get it approved once put to vote, is likely the difference between reviving 80% or 150% of their funds back.

The group is keen on influencing FTX’s proposed recovery plan and voting will help pick a draft to propose amendments.

Plans require approval from the voting block and the process will ensure that small creditors get to block a plan, even if large creditors vote for it. Even a very low turnout of voters can block a plan. 

The creator of the plan is anonymous, therefore users sharing their details with the coalition need to do so at their discretion. The form for recovery of funds does not require personal or login information.

SBF’s conviction is not the end of the road for creditors

While SBF was convicted on Thursday, the conviction did not bring closure to affected creditors that are seeking prompt recovery of lost funds.

Find out more about SBF’s conviction here.

 

 

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